AUSTERITY POLICIES AND FREUDIAN PSYCHIC ECONOMICS: A PSYCHOANALYTICAL METAPHOR OF THE FISCAL STATE

Abstract

This article aims to analyze the concepts of State, fiscal crisis, and austerity policies, linking them to Freud’s (1996a;1996b;1996c; 2011) theory of psychic economy in order to construct a psychoanalytic metaphor between state dynamics and the functioning of the psychic apparatus. It first discusses the historical evolution of the State and the emergence of the so-called fiscal State, in which taxation plays a structuring role in sustaining state functions and consolidating the Welfare State. Based on O’Connor (1977) and Schumpeter (1991), it is shown that the fiscal crisis results from the mismatch between public revenues and expenditures, leading governments to adopt austerity policies. By seeking to reduce deficits through social spending cuts, these policies undermine fundamental rights and deepen inequalities. In parallel, the Freudian theory of psychic economy is explored, according to which the functioning of the psychic apparatus depends on the regulation between drives, repression, and sublimation. The analogy reveals that, just as excessive containment of libido leads to psychic illness, severe austerity results in the “illness of the State.” In this sense, the psychoanalytic metaphor demonstrates that disproportionate austerity policies represent not only a limited economic response but also a perverse institutional structure with serious social, political, and ethical consequences.